February 24, 2024

Investments & Exits

Highlights from KPMG’s Study on Global Fintech Investment

On Friday, a survey revealed that the fintech business drew 164.1 billion dollars over 6,006 agreements in 2022, down from the peak of 238.9 billion dollars, spanning 7,321 agreements in 2021. As per KPMG’s ‘Pulse of Fintech H2-2022’ study, the payments industry remained the most robust fintech sector worldwide, drawing 53.1 billion dollars. Investment in financial technology fell precipitously from the first to the 2nd half of 2022, from 119.2 to 44.9 billion dollars, providing a clearer picture of the dynamic nature of the business.

According to KPMG’s chairman and chief of Financial Services Innovation, Anton Ruddenklau, the difference between the 1st half and the 2nd half emphasizes a rapid transition in investor beliefs amongst all the combinations of challenges. It includes increasing interest rates and high inflation, a lack of initial public offering exits, a sharp drop in market values. In particular, the regtech investment was staggering in 2022.

The United States alone contributed 61.6 billion dollars of the total global investment in fintech in 2022, making the Americas the leading regional force in global fintech investment of $68.6 billion. According to the research, a specific region garnered 50.5 billion dollars in 2022, setting a new record, while the EMEA area brought in 44.9 billion dollars. The 30 billion dollars invested in cryptocurrencies and blockchain technology in 2021 dropped to 23.1 billion dollars the following year.

 

As competition in the market increased, the drop accelerated in the 2nd part of the year. Ruddenklau said that the valuations would continue to be challenging for some years due to hiking interest rates. As a result, many large M&A deals will remain on hold while investors watch to check if prices drop significantly.

World fintech news provides insightful analyses of the financial industry and keeps you up-to-date with the latest developments in fintech. To read more news and stories about fintech, visit https://worldfintechnews.com/.

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